WASHINGTON, Aug.6 (Reuters) – The United States Postal Service (USPS) on Friday finalized a plan effective Oct. 1 to slow some first-class mail deliveries as part of efforts to reduce red ink.
Postmaster General Louis DeJoy proposed in March to revise existing service standards from one to three days to one to five days for first-class mail. The USPS said on Friday that 61 percent of first-class mail would remain at its current standard.
The USPS said in a Federal Register notice that current standards require it “to rely heavily on air travel, using air cargo carriers and commercial passenger carriers.”
Delivery standards will be slower for about 7% of periodicals.
Planes, USPS added, are less reliable than surface transport and cost significantly more due to “weather delays, network congestion, and air traffic control ground stops.”
“Adding one or two days to the current service standards for first-class mail and periodicals would allow the Postal Service to carry a greater volume of mail within the contiguous United States by ground transportation,” did he declare.
While acknowledging “some uncomfortable changes,” DeJoy defended the plan earlier Friday at a board of governors meeting, saying he pledges to deliver “to every address in the country, six days a week, and strives to ensure financial sustainability ”.
The USPS posted a quarterly net loss of $ 3 billion on Friday, with a 1.1% increase in first-class mail deliveries to 12.1 billion pieces. But “volumes remain below pre-pandemic levels and we expect continued secular declines,” he added.
For the minority of first-class mail affected by the slower delivery window, “the standard would only change for a day or two (with most of these volumes experiencing a one-day change),” the USPS said. .
The USPS added that it was unable to meet “service performance targets that have existed for many years, and that these service failures illustrate the weakness of the current transport model.”
In June, 20 state attorneys general called on the United States Postal Regulatory Commission to reject plans to slow some first-class deliveries, saying allowing this to happen could hamper local governments’ ability to perform essential functions.
DeJoy unveiled a plan in March to reduce projected losses by $ 160 billion over the next decade, with changes in service standards a key component.
The USPS has experienced poor delivery performance over the past year, facing a huge increase in packages and staffing issues due to the coronavirus pandemic. He said Thursday that up to July it delivered 89 percent of first-class mail on time, up 1.5 percentage points.
Beginning August 29, USPS will increase the prices of first-class postage stamps to 58 cents from 55 cents. Price hikes are needed because over the past decade, mail volume has declined by 46 billion items, or 28 percent, while first-class single mail has declined 47 percent, USPS said. .
Congress is considering a plan to provide the USPS with $ 46 billion in financial relief over 10 years, including eliminating the requirement that the USPS pre-fund retiree health benefits for 75 years.
The agency has reported net losses of about $ 90 billion since 2007. One reason is the 2006 legislation requiring it to pre-fund more than $ 120 billion in health care and pension commitments for retirees, a demand that unions have called an unfair burden not shared by other companies.
Reporting by David Shepardson; edited by Diane Craft, Marguerita Choy and Richard Chang
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